THE region's building industry remains optimistic, despite rising skills shortages.

According to the latest report from the Federation of Master Builders (FMB), the UK building sector experienced its 11th successive quarter of growth in the first three months of this year.

Nearly half of the 425 firms surveyed reported an increase in business.

However, after a strong performance in the last quarter of last year, FMB builders in the North-East have enjoyed mixed fortunes.

Just under half of builders in the region said their workloads had decreased in the quarter. But about 70 per cent of those surveyed said that new business inquiries had increased or remained constant.

And about half of the respondents expect an increase in business in the next quarter, mainly from the private housing, commercial and new public, non-residential sectors.

The lack of skilled labour in the market continues to pose problems for builders in the North-East.

However, about one in five builders expect to increase their staff levels in the second quarter of this year, although 40 per cent of those firms reported difficulties in recruiting skilled labour.

Barry Oliver, FMB regional director, said: "The findings of the report offers continued optimism to the building industry in the UK, despite the shortage of skilled labour, which is one of a number of issues on which the FMB is campaigning on behalf of its members.

"After excellent results at the end of 2001, it is encouraging to see that our members in the North-East are still busy and expect to be so for the foreseeable future.

He added: "The ongoing message for homeowners considering building work in 2002 is to book a reputable builder as soon as possible."

* Find an FMB-registered builder via the Find-a-Builder service at its website at www.fmb.org.uk or through the FMB regional office on 0191-281 3844.